Three specialists give their views on how the UK’s withdrawal from the EU is affecting the sector
Ashwin Mistry, executive chairman, Brokerbility and BHIB
“People are getting discontented with institutions – predominantly government and big corporates – and that is manifesting itself in behaviours right across the piece, and I don’t think we are immune to that in the UK commercial broking sector.
“You can sense it in conversations with clients, that they are feeling a little bit of distrust in institutions and the government, and we sadly represent the voice of institutions to them.
“So you’ve got an angry business community that is being affected by a lot of indecision by our politicians. And you are also getting some of the large corporations and financial institutions almost jumping ship in some people’s minds. This morning’s papers said that businesses have pressed the panic button. When the likes of Dyson have decided to relocate their head office, you have to start to listen.
“There is a herd mentality and it does feel like a ‘head for the hills’ kind of moment. You’ve just got to do the best you can to ride out the storm. Clients who are wondering whether to take on more people with a new initiative or to open another office and take on more debt are putting their growth plans on hold until there is more clarity.
“But you can’t put a whole nation on hold. How long do you hold for? Do you do it for three months or six months? And what is genuinely going to change in that time?
“That anxiety is playing out in customers’ minds, whether it is obvious or subliminal, and everybody is getting a little bit cheesed off. That is impacting how they talk to people. It is a very complex environment and at the moment there is far too much uncertainty.
“Brokers have to be careful how they tackle this. They have to be massively chameleon-like and very close to their customers, talking to them on a level that they understand and showing lots of empathy.
“We might be from different sectors but we are all facing the same issues – we’re all in it together. I have said in the past that a broker’s role is to be a ‘business doctor’ and this has never been more true.”
Phil Bayles, managing director, Intermediaries, UK Insurance, Aviva
“My glass tends to be half full on these things and so I’m an optimist around the economy. The biggest thing we need is certainty and once we have that, businesses can adjust to the Brexit decision, whether that is the UK being in the EU, out of the EU, or halfway between in and out.
“Companies are very good at adapting – they have to be. Think about all the changes we’ve seen from a technological, regulatory and economic perspective over the years. At the same time, they have to know what game it is they’re playing and that’s the problem at the moment. Hopefully we’ll get to the other side of March and there will be some certainty over what is happening and the economy will move on quite well from that.
“Brokers are entrepreneurial and they get on with things. They re-adjust, find ways to prosper and make money regardless, so my prevailing sentiment is that we should be cautiously optimistic. It’s not to say there aren’t challenges, or that it’s not difficult for certain lines and segments, but overall I think the broker industry is in pretty good shape and the underlying UK economy is strong.
“Obviously, the sooner we get clarity the better. And you can draw a few scenarios up and see that we could have a really good second half of the year if we can remove uncertainty and whatever is agreed isn’t too disruptive. At that point you’ve got a lot of pent-up demand to invest and get going again.”
Xavier Woodward, partner, Livingbridge and non-executive director, Coversure
“The only thing I can say with any certainty is that there is quite a lot of uncertainty. I have no idea how the Brexit story is going to unfold, although it does have to unfold over the next two months. At least, there’s a time limit.
“Whatever the future holds for the UK and its relationship with Europe and the rest of the world, it’s the job of business and the insurance industry (as a subset of the broader business community) to find better, more innovative and more customer-satisfying ways of doing things. If we can keep doing that, then we’ll be okay. If we don’t we will stagnate.
“Whether political events give us a tailwind or headwind, it doesn’t change the fundamental truth that we need our bright people to be finding better ways of doing things.
“The more people that are out there in the market thinking creatively, the healthier that is for the UK insurance industry. The more people who are in our industry that really understand the problems that people face and how we might help design the solutions, the better.
“People tend to view economic growth as though it is some magical thing that government can create. It’s not. It’s something that businesses create by doing things better.
“No commercial lines broker should assume they have a right to exist just because of the way the supply chain has worked previously in the insurance industry; there are always people coming up with better ways of doing things and disrupting the status quo.
“At the heart of the longevity of the industry is customer focus and a differentiated proposition. That’s stating the obvious perhaps but I’m often surprised by how much people seem to forget that.
“Lots of businesses are so consumed by the day to day, that their market share can almost feel like a sense of entitlement, and actually that’s not the way things work.”
No comments yet